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Convertible Note | 3 Months Ended
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Mar. 31, 2025
Debt Disclosure [Abstract] |
Convertible Note | Note 5 – Convertible Note As of March 31, 2025, the Company has a Convertible Note outstanding with Alpha Capital Anstalt (“Alpha”) which was due January 8, 2025 (the “Note”) and is considered in default. The Note is a result of an exchange agreement executed on February 8, 2024 in which the parties agreed to exchange the then outstanding promissory note into a convertible note. The Note accrues interest at 12% per annum and will increase to the lesser of 18% or the maximum rate permitted under applicable law upon an Event of Default as defined under the Note. As of March 31, 2025, the Note is convertible into shares of Common Stock at a conversion ratio of $1.10, subject to adjustment pursuant to dilutive protection terms included in the Note. AGEAGLE AERIAL SYSTEMS INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND 2024 (UNAUDITED) During the three months ended March 31, 2025 and 2024, Alpha converted $770,000 and $100,000 of outstanding principal into 700,000 and 1,597 into shares of Common Stock at a conversion rate of $1.10 and $62.50, respectively. As of March 31, 2025 and March 31, 2024, the outstanding principal and accrued interest on the Note was $563,333 and $4,749,491 and $65,926 and $69,659, respectively. For the three months ended March 31, 2025 and 2024, we recognized interest expense on the Note of $18,802 and $106,000, respectively. During the three months ended March 31, 2024, the conversion price of the Note was reduced from $62.50 to $30.00 pursuant to dilution protection provisions and due to the reduction in warrant exercise prices to $30.00 to induce exercise (see Note 7). The Company recognized in interest expense the amount of $3,488,851 for the incremental value of the conversion feature due to the reduced conversion price. The incremental value was determined using a Black-Scholes pricing model pre and post modification and the following inputs: expected term 0.92 years, risk free rate of 4.83%, volatility of 89.6%, and dividend rate of 0%. During the three months ended March 31, 2025, there were no adjustments to the conversion price on the Note.

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